Wealth, it is a tricky concept. Pursued by many for the ability to survive, live well, and provide for the various aspects of life. Since most modern day economies are based on currency, it makes sense that wealth contributes overwhelmingly to what people value in life. However, I believe this inherently sets us up for one of our greatest failures if we don’t proactively look at the concept of wealth itself.

Each country is different in how much it takes to earn an education for a proper job, feed yourself and your family and establish a home. In regards to United States, I have come across numerous studies that state the annual salary needed to satisfy the needs of life. In 2010, Kahneman and Deaton carried out an analysis on happiness associated with income within the United States at Princeton University.  Out of 450,000 responses to the Gallup-Healthways Well-Being and a daily survey of 1,000 US residents, they found emotional well-being rises with log income, but there is no further progress beyond an annual income of ∼$75,000 (Kahneman and Deaton 2010).

For other countries, this value varies depending on various economies and cost of living. Some could also argue that within the United States, this quote is generous in its own right and that they could be easily happier with less, and maybe there are still others who would argue a higher income. For this discussion though, it is not so important what is the right number, but that there is an annual income that provides optimum happiness and that there is a limit to when wealth no longer correlates to happiness.

I would argue that earnings up to that number are used as a tool to help achieve happiness whereas earnings earned after say $75,000 are no longer used as a tool, but a destination. Up to $75,000, people are spending their earnings on education, food, healthcare, shelter and even entertainment for themselves and family. They are using the currency as a tool to achieve the things that yield security and happiness. Conversely, after that mark of $75,000, perhaps the reason Kahneman and Deaton do not see people getting any happier is because people are pursuing excess wealth at the detriment to the things that they once used wealth to find. They end up working too many hours, sacrificing their health, family time, and the true pursuit of happiness for additional wealth as a goal itself, even though it will bring no additional happiness.

The Dalai Lama, when asked what surprised him most about humanity, answered “Man…. Because he sacrifices his health in order to make money. Then he sacrifices money to recuperate his health. And then he is so anxious about the future that he does not enjoy the present; the result being that he does not live in the present or the future; he lives as if he is never going to die, and then dies having never really lived.”

So I guess the question would be to ask oneself, “am I using my current income as a tool or am I using it to achieve more wealth?”

References:

Kahneman, D. Deaton, A. 2010. High income improves evaluation of life but not emotional well-being. Center for Health and Well-being, Princeton University, Princeton, NJ 08544.